Former US President Barack Obama admitted that the neoliberal capitalist policies he and his predecessors supported fostered the rise of the far-right and grossly exacerbated inequality.

By Ben Norton

Former US President Barack Obama has acknowledged that the neoliberal capitalist economic policies that he and previous administrations staunchly supported helped fuel the rise of the far right.

Obama conceded that the Washington Consensus, the right-wing neoliberal economics that has been embraced by every US president since Ronald Reagan, led to a massive increase in inequality.

Even while Obama continued to defend these pro-corporate policies, he confessed that they left behind large numbers of working-class people across the world, in areas that were hit hard by capitalist globalization. This led to rising unemployment and reduced living standards, Obama said, which in turn fostered the growth of right-wing xenophobic nationalist politics.

BARACK OBAMA: “When it comes to the economy, part of what happens is that the globalization that — you know you actually had a consensus between Bill Clinton, George H. W. Bush, George W. Bush, and certainly elements of my administration, and we wanted to get the Trans-Pacific Partnership done for example, TPP. The consensus around things like free trade didn’t fully address the fact that — although net-net, the whole world was doing better because of globalization, and the internet, and global supply chains — there were folks who whose pantries were being closed and suddenly found themselves to be redundant workers.

“And you suddenly had a winner-take-all economy, where, back in 1960, maybe the CEO makes 10 times more than the guy on the assembly line; now suddenly it’s 200 times, or 300 times. And the capacity of nation states to regulate global capital so that at least they have some control where they say, you know what, let’s speed things up, slow things down; let’s ease the transition for communities that are being hurt by, whether it’s automation or foreign competition; that becomes harder to do, because everybody’s just worrying about what their quarterly reports are going to look like on Wall Street.

“So now that creates frustrations and contradictions. And then I think a legitimate critique of that consensus — which I consider myself to be a part of, and still believing — is that we did not adapt quickly enough to the fact that there were people being left behind, and that frustrations were going to flare up, and that all these changes that were happening were happening really quick, and you had to address them and speak to them.

“And in those environments you then start getting a different kind of politics. You start getting politics that’s based on, ‘That person’s not like me, and it must be their fault.’ And you start getting a politics based on a nationalism, that’s not pride in country, but hatred for somebody on the other side of the border.”

The former US president even admitted that, after the victory of capitalism in the Cold War, there has been a “period of great smugness on the part of America and American elites,” and he lamented, “that came back to bite us.”

BARACK OBAMA: “Part of what’s happened is that when people feel their status is being jostled and threatened, they react.

“And what I would agree with is that the Washington Consensus, whatever you want to call it, got a little too comfortable with, they’re looking at GDP numbers, and they’re looking at the internet, and everything is looking pretty great; and particularly after the Cold War, Jim, after what you guys engineered, you have this period of great smugness on the part of America and American elites, thinking, ‘We got this all figured out.’ Remember there were books coming out that it’s the end of history.”

JAMES BAKER: “Yeah, ‘The End of History,’ Francis Fukuyama.”

BARACK OBAMA: “Yeah, that came back to bite us.”

Barack Obama made these remarks in a discussion with a former top Republican official. On November 27, Obama spoke at an elite gala in Houston, Texas alongside James Baker, who previously served as secretary of state for George H. W. Bush and White House chief of staff and treasury secretary for Ronald Reagan.

The former Democratic president helped encourage 1,100 rich and powerful guests to donate $5.4 million in just one night to Rice University’s pro-corporate think tank the Baker Institute for Public Policy.

Earlier on that day, Obama had also met with former Republican President George H. W. Bush at his Houston home.

In his speech, Obama stressed the importance of bipartisanism and finding common cause with Republicans.

At one point, he even boasted of having increased fossil fuel production and made the United States into the largest oil producer. And even while Obama acknowledged that the neoliberal capitalist policies that both he and his predecessors oversaw devastated the working class and poured gasoline on the fire of right-wing extremism, at the same time, he also joked that corporate executives on Wall Street should be thanking him for helping them make so much money.

BARACK OBAMA: “Look, I know we’re in oil country, and we need American energy. And by the way, American energy production — you wouldn’t always know it — but it went up every year I was president. And that whole, ‘Suddenly America is the biggest oil producer’ — that was me, people.

“It’s a like, you know, sometimes you go to Wall Street, and folks will be grumbling about, ‘Anti-business…’ And I say, ‘Have you checked where your stocks were when I came in office, and where they are now?’ What? What are you talking, what are you complaining about? Just say thank you, please.”

Ben Norton is a journalist, writer, and filmmaker. He is the assistant editor of The Grayzone, and the producer of the Moderate Rebels podcast, which he co-hosts with editor Max Blumenthal. His website is BenNorton.com and he tweets at @BenjaminNorton.